Paul L. Caron

Thursday, February 25, 2021

Conflict Surrounds Charleston Law School Land Deal, With $13 Million At Stake

Post and Courier, Conflict Surrounds Charleston School of Law Land Deal, With Nearly $13M at Stake:

Charleston Logo (2017)When Charleston sold land to the for-profit Charleston School of Law 16 years ago, at a discount, the plan was for CSOL to build a school there, not flip the property to a hotel developer for a huge profit.

Now, with a $12,850,000 sale pending and a nine-story hotel planned on the property at Meeting and Woolfe streets, City Council has been delaying the sale. CSOL President Ed Bell calls it a “shakedown” and warns that the city could be sued.

“The city has lots of risks from being cute and smart about this,” said Bell, a Georgetown lawyer. “If you’re going to do a shakedown, you’d better be right.”

It’s a dispute about money, expectations and an amended deal the city signed in 2017.

In that deal, the city agreed that although CSOL hadn’t built a school, it could sell the property at 431 Meeting St. The city would get 25 percent of the money — minus the $875,000 that CSOL paid for the land and some smaller deductions.

Add it up and the city would get just over $2 million from the sale, council members have been told. ...

The city’s original 2005 agreement said Charleston would get the property back if CSOL didn’t use it “for law school purposes and the permanent development or construction to facilitate such usage” within six years. The deal was later extended for another six years, and when that time expired in 2017, CSOL claimed that the deal didn’t actually require them to build a school there.

That’s when the city agreed to allow the property to be sold, with CSOL getting most of the profit.

Prior TaxProf Blog coverage:

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